• by Wayne Friedman , August 30, 2005

After years of fits and false-starts, interactive TV is finally approaching the kind of critical mass that should garner the attention of national advertisers. At least that's what the TV technology trackers at Kagan Research figure.

In four years, more than half the country's TV households will have interactive technology, according to a report released this week by Kagan.

The growth will come in three areas--the overall growth in digital subscribers, digital set-top boxes, and interactive-enabled digital set-top boxes. That would give 69 million homes some interactive capability by 2009, according to the report.

Strong competition from cable operators, satellite distributors, and other interactive sellers is pushing companies to offer up a wide-ranging number of services to consumers.

Revenue from electronic transactions, says Kagan--games, television, or T-commerce and interactive advertising--will reach $2.4 billion by the year 2009.

Other interactive services will generate $780 million in revenue by 2009, according to Kagan.